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Are CarMax Cars Really Worth The Price Premium?

CarMax cars aren't any different from traditional used cars, but the markup still exists

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As Jalopnik’s resident car buying expert and professional car shopper, I get emails. Lots of emails. I’ve decided to pick a few questions and try to help out. This week we will discuss if CarMax cars are worth the premium, how to search for a specific truck, and the risks of buying a used car with modifications.

First up, is paying more for a CarMax car worth it?

“I currently live in LA, but will be moving to Detroit within the next few days. I may be looking for a Golf R.

My main question is about the CarMax markup. They have 2 Golf R’s near LA, but both are about $3k+ more than the estimate. Is the CarMax markup worth it to get a reliable car? I was also considering getting a CarMax warranty until 100k miles, so I also wanted to get your advice on if that was a smart buy as well. Let me know if going with CarMax is a good idea, or if I should consider another route.”


As we all know, CarMax is very good at marketing. Its pitch is that “we are a better used car dealer than most of those other jokers,” and that pitch works for your average buyer. A lot of folks are under the impression that you will get a higher quality car at CarMax versus any other used car lot. CarMax knows this and they often charge a premium for their models. In fact, as I previously have covered, CarMax is the most profitable used car retailer by a ridiculous margin over their competitors.


The truth is that CarMax cars, on average, are not any different than any other used car that you would find at a major dealer. CarMax gets their cars from trade-ins and auctions just like most dealers. You can find some gems at CarMax and you can find some duds. In 2016, a judge found in favor for a man in California who sued CarMax after buying a used Infiniti which, according to the plaintiff, should not have passed CarMax’s “inspection process.”

Now the benefit of CarMax, especially for an out of warranty performance car, is the ability to buy a fairly comprehensive warranty to cover you. The benefits of this warranty may have been mentioned a few times on this website by some dude whose name escapes me at the moment. However, thanks in part to that chronicle, MaxCare warranties aren’t nearly as cheap as they used to be. So they may or may not be worth it.

In the case of this Golf R, if you can find cheaper cars and they check out those are likely better values. Whatever you find, make sure you get it inspected before signing anything.

Update 3:27 PM EST: CarMax sent in this statement in response to what we wrote:

We’re proud of the quality of our vehicles and we work hard delivering on our quality promise every day in our more than 200 stores nationwide. While we obtain retail inventory from auctions and trade-ins, millions of cars are ruled out by our vetting process. We never sell cars with flood damage, frame damage, or salvage history. We recondition every used vehicle we retail and each car must pass a 125+ point inspection, ensuring our highest standards are met. We spend an average of 15 hours on every car, fixing dings, replacing worn parts, and deep cleaning the interior. Then we inspect it again.

We also stand behind our vehicles and protect our customer’s investment with the CarMax Love Your Car Guarantee experience which includes 24-hour test drives and 30-day returns (up to 1,500 miles), and a 90-day/4,000-mile limited warranty (whichever comes first),


Next up what is the best way to look for a used truck with specific options.

I am in the market for a used 1/2 ton truck but unlike most I will be using mine for pulling. I know the first instinct is to buy a gas 3/4 ton but I don’t want to sacrifice ride quality for the few times I will pull. I know that gearing makes a huge difference in how a truck pulls. My last truck had the lower gear option and it pulled so much better that I wouldn’t even consider one without it. I like GM trucks and to get the low gear you had to get what they call Max Trailering Package. The problem is most online car sales sites don’t list gear ratio or that option on the drop down menu. Another complaint is I want the 6.2 engine, not the 5.3. That option doesn’t exist either. So when you have a client with those criteria how do you shop for that?


Searching for trucks, especially if you are picky about your features, is very difficult. There are practically millions of combinations for pickups regarding engine options, bed lengths, door styles, gear ratios and then trims with feature sets within those trims.

How I do this when I am hunting for a truck is I find the trims that are most likely to have the feature set that my customers are looking for, locate matches that seem close then request the dealer send me a window sticker. If the truck is being sold by a dealer of the same brand, for example, a Ford truck at a Ford dealer, this is usually possible. If the truck you want is not being sold by that brand there are numerous window-sticker lookup tools and VIN decoders online that can often detail out the options and features installed on that specific vehicle.


I hate to say it but this is going to be a grind. So you have to be patient and be willing to put some work in to find your perfect truck.

Finally, how risky is a “tuned” car?

I’ve been looking at used GTI or Golf R and noticed that a lot have been tuned; which brings me to the questions:

-Would you ever own a tuned, outside of warranty, car (especially one done under the previous owner)?

-Does your opinion change depending on the “aggressiveness” of the tune?

-Individual sellers list all of the mods they have made to the cars (selling point?), but dealers don’t; is there any way of knowing if a car on a dealer’s lot has been tuned (e.g. I can see an aftermarket intake/exhaust, which makes me suspect the car may have been tuned as well), can I confirm that somehow?

I’ve bought all my cars used and none have been under warranty, so I’m not really scared of that. But, none of them have been performance cars or tuned so pretty low probability they were thrashed by the previous owner. What I’m trying to say is I understand the potential costs of ownership with used cars, but I also don’t want my engine to grenade because it was pushed way beyond what the engineers intended.


If I have the choice between buying an unmodded car vs a modded car, I will take the stock car any day. The problem with mods is two-fold. First, you don’t always know the quality of the mod nor the quality of the work that installed that modification. Second, think of the type of driver that will mod a sport compact like a GTI or Golf R, there is a reason that we call these cars “pre-hooned” rather than “pre-owned.” Now that is not to say that all modded cars have been abused and drivers don’t beat the snot out of cars that remain stock.

That being said, the benefit of a well-modded car that is already out of warranty anyway is you potentially get higher performing car that you would have otherwise at a similar price point. In either case, whether the car is modded or not, a pre-purchase inspection is highly recommended to make sure there are no red flags.


This story was originally posted on March 1, 2019.

Got a car buying conundrum that you need some assistance with? Email me at!